Reinsurance

In mid-June Allied World Assurance Co. Holdings AG and Transatlantic Holdings Inc. announced a $3.2 billion merger deal, creating a global specialty insurer and reinsurer operating in 18 countries and on six continents.

The soft market remains firmly entrenched on the casualty side of the reinsurance business. But the property and catastrophe marketplace is a much different—and more unsettled—story.

For U.S. coastal property business, “the market’s capital has felt ‘three Katrinas,’” according to experts at a reinsurance broker, which previously speculated it would take three Katrina-sized events to push up reinsurance prices.

Consumers are being told that SB 408 will suddenly allow for large homeowners premium rate hikes because of reinsurance costs. We need to tell them the real story, starting with why reinsurance is important to everyone.

The stability of the Florida Hurricane Catastrophe Fund shifts with time and circumstance. The good news is that the Cat Fund currently has a large amount of money at its disposal. The bad news is that the funds exposure is huge.

An analysis developed by Citizens Property Insurance Corp. shows that Florida policyholders could be on the hook for significant assessments if the state gets hit by a major storm.